Aussie Hits Multi-Year High on Hawkish RBA Bets

2026-03-11 01:10 By Joshua Ferrer 1 min. read

The Australian dollar strengthened to around $0.716, hitting its highest level since May 2022, boosted by mounting expectations of a rate hike next week.

The Reserve Bank’s deputy governor signaled that rising oil prices could push inflation higher, increasing pressure for a rate increase at the March 17 meeting, which the central bank has described as “live” on rates.

Markets quickly lifted the odds of a March hike to around 75%, up from below 30% earlier in the week, with another move now fully priced by August.

In total, traders are pricing about 60 bps of tightening this year, which could push the cash rate above its post-pandemic peak hit when inflation exceeded 7%.

Currently, the headline inflation sits at 3.8% and is expected to surpass 4% as petrol prices continue to climb, while core inflation remains elevated at 3.4%, well above the RBA’s 2–3% target band.

Elsewhere, markets remained on edge amid conflicting reports and mounting uncertainty surrounding the Middle East war.



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Aussie Hits Multi-Year High on Hawkish RBA Bets
The Australian dollar strengthened to around $0.716, hitting its highest level since May 2022, boosted by mounting expectations of a rate hike next week. The Reserve Bank’s deputy governor signaled that rising oil prices could push inflation higher, increasing pressure for a rate increase at the March 17 meeting, which the central bank has described as “live” on rates. Markets quickly lifted the odds of a March hike to around 75%, up from below 30% earlier in the week, with another move now fully priced by August. In total, traders are pricing about 60 bps of tightening this year, which could push the cash rate above its post-pandemic peak hit when inflation exceeded 7%. Currently, the headline inflation sits at 3.8% and is expected to surpass 4% as petrol prices continue to climb, while core inflation remains elevated at 3.4%, well above the RBA’s 2–3% target band. Elsewhere, markets remained on edge amid conflicting reports and mounting uncertainty surrounding the Middle East war.
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